Monthly dividend stocks are highly appealing for income investors. That is because these particular dividend stocks pay their dividends every month, instead of once per quarter like most dividend-paying stocks.

However, investors must also evaluate stocks to make sure they have sustainable dividends. The following 3 stocks have safe monthly dividends.

Realty Income (O)

Realty Income is a retail real estate focused REIT that has become famous for its successful dividend growth history and monthly dividend payments. Today, the trust owns thousands of properties. Realty Income owns retail properties that are not part of a wider retail development (such as a mall), but instead are standalone properties. This means that the properties are viable for many different tenants, including government services, healthcare services, and entertainment.

In the most recent quarter, net income available to common stockholders was $227.3 million, or $0.36 per share. Normalized FFO (Funds From Operations) increased by 18.0% to $1.05 per share, compared to the three months ended December 31, 2021. Additionally, AFFO (Adjusted Funds From Operations) increased by 6.4% to $1.00 per share, compared to the same period in 2021.

Future growth will be driven by rental increases, as well as property acquisitions. The company completed the Encore Transaction, acquiring the land and real estate assets of Encore Boston Harbor Resort and Casino from Wynn Resorts, Limited for $1.7 billion. Realty Income invested $3.9 billion in 578 properties, including properties under development or expansion, with $387.9 million invested in Europe, which includes the first investment in Italy for seven properties, totaling $166.6 million.

The company also announced the acquisition of up to 185 single-tenant retail and industrial properties from CIM Real Estate Finance Trust, Inc. for approximately $894 million, expected to close in the first half of 2023. Moreover, the net debt to annualized pro forma adjusted EBITDAre was 5.3x.

Its current dividend payout ratio near 80% is close to the bottom of the historical range. Due to the steady growth of Realty Income’s profits, even during the last financial crisis, the dividend looks sustainable.

STAG Industrial (STAG)

STAG Industrial is an owner and operator of industrial real estate. It is focused on single-tenant industrial properties and has 563 buildings across 41 states in the United States. STAG Industrial went public in 2011 and has a market capitalization of $6.3 billion. The focus of this REIT on single-tenant properties might create higher risk compared to multi-tenant properties, as the former are either fully occupied or completely vacant.

In mid-February, STAG Industrial reported (2/15/23) financial results for the fourth quarter of fiscal 2022. Core FFO grew 12% over the prior year’s quarter thanks to the sustained strength of the REIT’s tenants and material hikes in rent rates. Core FFO per share grew at a slower rate (8%), from $0.51 to $0.55, due to the issuance of new units. Net operating income grew 14% over the prior year’s quarter while the occupancy rate remained strong at 98.5%. STAG Industrial is facing a headwind due to the pandemic and the ongoing economic slowdown.

STAG Industrial has a well-laddered lease maturity schedule, with a weighted average lease term of 4.9 years and about half of the leases maturing after the end of 2025. STAG Industrial currently offers a yield above 4% and has never cut its dividend throughout its short history. Its dividend payout ratio of 65% of adjusted FFO-per-share for 2023 indicates a safe dividend. STAG yields 4.4%.

Superior Plus (SUUIF)

Superior Plus Corporation is a relatively small industrial company but one of the larger propane distributors in North America. The company is the dominant distributor in Canada (30% of EBITDA), has significant operations in the U.S. (60% of EBITDA), and is also a propane wholesaler (10% of EBITDA). Superior Plus generates around $3.8 billion in annual revenues.

On February 16th, 2023, Superior Plus reported its Q4-2022 and full-year results. In Q4, the company generated an adjusted EBITDA of 135.7 million, a $30 million increase compared to the prior-year quarter. Adjusted operating cash flow per share totaled $0.25. Management introduced its FY2023 outlook, expecting adjusted EBITDA to be in the range of C$585 million to C$635 million, suggesting a 35.6% increase year-over-year in its midpoint.

The company has maintained a steady dividend for several years. With a payout ratio of approximately 54% for 2023, the dividend appears safe. Shares currently yield 6.8%.
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Bob Ciura has worked at Sure Dividend since October 2016. He oversees all content for Sure Dividend and its partner sites. Bob received a Bachelor’s degree in Finance from DePaul University, and an MBA with a concentration in Investments from the University of Notre Dame.